You observe the following prices for different bonds (note that the coupons on all of them have just been paid and their face value is 100).

Calculate the return on each of these bonds.

Reconstruct the zero-coupon curve at 5 years

I have the answers but I am unsure of how to explain how I got them. I understand there is a long excel formula but how would I explain the answers without using excel formulas? TIA!

Chapter 20. Exercise 1 You observe the following prices for different bonds (note that the coupons on all of them have just been paid and their face value is 100). Bond Maturity (an) Price 1 1 99.0 99.0 2 2 Annual coupon 7% 9% 8% 7% 10% 3 95.0 4 4 89.0 5 5 97.0 a. Calculate the return on each of these bonds. Bond Price 1 Maturity (an) 1 2 3 2 Annual coupon 7% 9% 8% 7% 10% Return 8.08% 9.57% 10.01% 10.51% 10.81% 3 99.0 99.0 95.0 89.0 97.0 4 4 5 b. Reconstruct the zero-coupon curve at 5 years. Maturity (an) Bond 1 2 2 3 Annual coupon 7% 9% 8% 7% 10% Return 8.08% 9.57% 10.01% 10.51% 10.81% Price 99.0 99.0 95.0 89.0 97.0 Zero-coupon rate 8.08% 9.64% 10.09% 10.62% 11.01% 3 4 4 5 5 Chapter 20. Exercise 1 You observe the following prices for different bonds (note that the coupons on all of them have just been paid and their face value is 100). Bond Maturity (an) Price 1 1 99.0 99.0 2 2 Annual coupon 7% 9% 8% 7% 10% 3 95.0 4 4 89.0 5 5 97.0 a. Calculate the return on each of these bonds. Bond Price 1 Maturity (an) 1 2 3 2 Annual coupon 7% 9% 8% 7% 10% Return 8.08% 9.57% 10.01% 10.51% 10.81% 3 99.0 99.0 95.0 89.0 97.0 4 4 5 b. Reconstruct the zero-coupon curve at 5 years. Maturity (an) Bond 1 2 2 3 Annual coupon 7% 9% 8% 7% 10% Return 8.08% 9.57% 10.01% 10.51% 10.81% Price 99.0 99.0 95.0 89.0 97.0 Zero-coupon rate 8.08% 9.64% 10.09% 10.62% 11.01% 3 4 4 5 5